CHINA aims to attract more foreign investment in its bonds and stocks as the country further opens up its capital markets, the foreign exchange regulator said Thursday.

There is significant room for foreign investors to buy Chinese bonds and stocks given their holdings of such instruments accounted for just 2-3 percent of the total, Wang Chunying, spokeswoman for the State Administration of Foreign Exchange (SAFE), said at a news conference.

“China will become an important destination of diversified asset allocation for global investors in the future, under the policy of further opening up and facilitation,” Wang said.

Overseas institutions bought a net US$9.5 billion in Chinese bonds and a net US$19.4 billion in listed Chinese stocks in the first quarter of 2019, she said.

Wang also said China will improve channels for opening up its interbank bond market and develop the panda bond market.

Commenting on the U.S. Federal Reserve’s policy stance, she said it will be favorable for the nation’s capital flows, and expects the cross-border capital flows to remain steady despite some uncertainties.

The Fed recently called a halt to further rate hikes over this year in the face of rising global economic risks, in turn putting a dent on the dollar.

Wang said China will ensure safety of its forex reserves, reaffirming a pledge to improve the yuan regime as well as the flexibility of trading in the currency.

Chinese commercial banks sold a net US$9.1 billion in foreign exchange in the first quarter, the regulator said, adding the nation’s current account is likely to maintain a surplus in the first quarter of the year.

China’s cross-border capital flows are expected to remain steady this year, helped by the government’s growth-supportive policies, Wang said. (SD-Agencies)